Since the advent of COVID-19 we have seen a surge in fraud. This has included both COVID-19 specific fraud and general economic crisis-driven fraud.
The risks to organisations are both internal and external. Possible economic pressures may lead people to radically re-evaluate loyalties and to rationalise behaviour which, in normal times, they would not consider appropriate. Previous recessions have seen a new generation of fraudsters created where the ‘normal’ dishonest minority is enlarged by those determined to protect their income and assets no matter what. This is particularly the case because of some over-extending with a post-Brexit surge of expenditure, house buying and investment, all of which came to an abrupt halt with the advent of COVID-19.
The impact of this has been seen in the latest Office for National Statistics crime statistics* which have shown a 19.8% increase in the incidence of fraud in England and Wales.
It is likely that this will impact on the cost of fraud and error, and we will see what this is in the next Financial Cost of Fraud report in 2022.
*ONS CSEW statistics for the 12 months up to the end of March 2020 versus the same statistics for the 12 months up to the end of September 2020.
Download the full Financial Cost of Fraud report